Payment of taxes on time is not difficult, but sometimes taxpayers make inaccurate payment of taxes due to errors or lack of knowledge of tax laws. Underpayment of taxes, intentionally or unintentionally, can lead to tax debt. Therefore, tax preparation must be done either by a taxpayer who has deep knowledge of tax laws or by a professional tax preparer.
Medical expenses, child-related costs, business expenses, gambling winnings and losses are some of the expenses taxpayers can consider when filing taxes. Medical and dental costs that exceed 10 percent of your adjusted gross income are tax deductible. Taxpayers must remember to keep a written document such as a receipt to claim a deduction.
Another cost that many taxpayers overlook is child-related costs. There are many child-related tax breaks that parents can claim including the cost of a breast pump and supplies that assist lactation. Parents can consider claiming these tax deductions to reduce their tax liability.
Although some tax deductions such as writing off meals and entertainment costs for business purposes can lower tax liability, it must be remembered that taxpayers need to show legitimate reasons for the expenditure. Writing off personal expenses as business expenses is a type of tax fraud that the IRS has cited as the most popular form of tax fraud by the self-employed and small businesses.
To avoid inaccuracies, taxpayers can use the help of legitimate tax preparers to get their taxes prepared. Most taxpayers use hired help to file accurate tax returns, and save the effort and time in preparing tax returns.